Though snow still blankets the ground in many states and winter continues to drag on, there is a telltale sign that spring is nigh: daylight savings time begins on Sunday March 8, 2015 at 2:00 a.m. At that time, the clocks "spring" forward from 2:00 a.m. to 3:00 a.m. – a change that carries several implications for employers.
Non-exempt employees working the overnight shift will be entitled to pay for only seven hours rather than eight hours, because there will be no 2:00 a.m. hour to work. Employers are certainly free, however, to pay employees the additional hour of pay (or, they may be required to do so pursuant to a collective bargaining or other agreement), but if they do so they may not credit it towards any overtime compensation actually due to the employee for the week. Nevertheless, in calculating any overtime due, this additional hour need not be counted in determining whether the employee crossed the 40-hour threshold and should not be included in calculating the employee's overtime rate.
It's also worth mentioning that Employers will face additional issues in the fall (November 1, 2015) when daylight savings time ends and most clocks across the country are set back an hour. Non-exempt employees working a shift during that time must be provided with an additional hour of pay. For example, if an employee's shift runs from 10:00 p.m. to 6:00 a.m., the employee will receive nine hours of pay instead of eight hours of pay because he or she will have worked the 1:00 a.m. hour twice. In calculating any overtime due, employers must count this additional hour in determining whether the employee crossed the 40-hour threshold and must also include the additional hour of pay in calculating the employee's overtime rate.
This issue affects all non-exempt employees, except those working in Arizona and Hawaii – the two states that do not observe daylights savings time.
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